The Globalization of Indian Firms from Steel to Software
Chapter 5: Accelerating Innovation in Manufacturing – Architecting Complexity: Stage III
In this chapter, I focus on adaptive responses that helped shape the development of complex organizational systems1 in the three manufacturing ﬁrms described in the previous chapter (Steelworks, Bearings, and Earthmovers) as they sought to globalize in the new millennium (post-2000). Increasing global competition required continuous adaptation by organizational restructuring and value chain reconﬁguration to respond to competitive challenges, uncertainty, and complexity.2 Improved manufacturing capabilities enabled these ﬁrms to gain autonomy and enhance their position within their parent network, thereby leading them to assume greater responsibility, expand internationally, and develop a global perspective. Although apprenticeship was the chief mode of learning in the earlier stages, during this stage the emphasis was on transforming the organization to support larger-scale operations while fostering local innovation. This transformation entailed shifting to an industrialized system of knowledge production by adopting a modular organization and relying more on codiﬁed knowledge to accelerate innovation. It also required aligning the ﬁnancial, strategic, and operational goals of the organization to compete in a global market. New organizational capabilities developed in earlier stages by adopting lean manufacturing systems and using advanced information and communication technologies set the stage for coherent global expansion and integration. By aligning overall strategy with every functional area, ﬁrms were able to achieve control and manage internal reorganization to match strategic aspirations. Past success in achieving goals of acquiring and assimilating new technology led executives to view themselves as participants in a global economy. Leaders of these ﬁrms concentrated on making the organization...
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